Today, the index was at 1754, down 3.6% from yesterday, and 9.4% from
last Friday.

This is down 28% from the March high and decisively takes out the interim
low of 1983.

The panic low in December was 1763. The cyclical high was 3201 in May,
2007.

* * * * *

Grain Prices Are Toast:

Our index of corn, wheat and soybeans set its high at 3094 at the end
of February.

The initial slump was to 2393 on March 20.

The rebound made it to 2646 in the middle of April.

Yesterday's 2391 is down 23% from the high and at the point of failure.

* * * * *

The talking heads on TV as well as many commodity experts are still going
on about soaring prices, but these two important sectors have had their blow
offs and have failed.

In some cases such as copper, lead, nickel and wheat their bull markets accomplished
the biggest percentage gains in over a hundred years. That is real terms as
deflated by the PPI and the gains were greater, by far, than those with the
typical bull market or even the best previous. Some examples follow.

The game to load up novitiates with commodities began some time ago and has
come to fruition on this business cycle.

"Pork Bellies in Your Pension

"The bullish case is being vigorously espoused. Goldman Sachs...one
of the loudest advocates of commodities has been urging large funds to
keep 5% of their portfolios in commodities.

- Financial Times November 7, 1994

Financial institutions "investing" in commodities will eventually be seen
as a great policy blunder. While a breach of fiduciary responsibility, the
blunder has been in response to the most magnificent blunder in financial history
- the sure thing that central bankers will be able to depreciate their currencies
forever. This has been an ancient practice to serve ambitious government, and
an insidious breach of accountability--otherwise known as policymaking.

When this writer started with Canada's premier investment dealer in 1963,
the notion prevailing at the highest levels was that institutions should be
mainly positioned in high-grade bonds. This was safe as chronic inflation was
a disease that only afflicted Europe, or banana republics. This could not happen
in Canada, or the US, and high-grade bonds would not increase in yield beyond
5%. The high was 15% in 1981, when bonds were universally scorned.

What asset class will fail next?

COPPER
BIGGEST BULL MARKETS SINCE 1900
(ADJUSTED BY PPI)

Start

Peak

Gain

Subsequent Low

Year

79
Nov. 2001

417
May 2006

428 %

? ?

? ?

98
Oct. 1994

262
Dec. 1988

167 %

79

2001

99
Nov. 1946

271
March 1956

174 %

126

1958

98
Nov. 1920

245
Apr. 1929

150 %

75

1932

This one was published in May 2006 and that high in the real price still
holds.

The subsequent decline ran into February, 2008 and amounted to 40%.

The rebound in the nominal LME price made it to 403 in early April.

The current price is 375.

LEAD
BIGGEST BULL MARKETS SINCE 1900
(ADJUSTED FOR PPI)

START

PEAK

GAIN

SUBSEQUENT LOW

YEAR

551
Oct 2002

4155
Oct 2007

654 %

? ?

? ?

507
March 1985

1,966
March 1990

287 %

507

1993

939
Dec 1975

3,249
June 1979

277 %

556

1985

739
Sept 1962

2,290
Feb 1965

210 %

939

1971

517
July 1932

1,964
Mar 1937

280 %

812

1938

616
Feb 1921

1,988
Dec 1924

223%

517

1932

The October high still holds.

The initial decline into January amounted to 37%.

In nominal terms the October high was 3958 and the December low was 2340.

The rebound high was 3399 in March.

The current price is 1996.

CRUDE OIL
BIGGEST BULL MARKETS SINCE 1900
(DEFLATED BY PPI)

START

PEAK

GAIN

SUBSEQUENT LOW

YEAR

16.44
Dec. 1998

133.7 ?

715 %

? ?

? ?

18.91
March 1986

60.99
Oct. 1990

223 %

15.94

1998

14.59
May 1973

82.34
March 1980

464 %

18.91

1986

4.22
May 1933

18.10
Jan. 1950

331 %

14.59

1973

6.13
May 1915

30.69
Dec. 1920

403 %

4.22

1933

Source: TheChartStore.com

The table compares all of the big bull markets over the past 100 years.
It does not attempt to analyse the technical or timing dynamics, but establishes
perspective.

At +715%, this bull market has racked up the biggest gain, which is outstanding
compared to the previous best at +464% to the sensational high in 1980.

Over the past year, similar extraordinary gains, for example, recorded
by wheat, copper, lead and nickel.

Often crude oil can make an important seasonal high in March. If this
doesn't work out there are examples of an even bigger seasonal high in
May.

The opinions in this report are solely those of the author.
The information herein was obtained from various sources; however we do not
guarantee its accuracy or completeness. This research report is prepared for
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